Governor Rendell Proposes Initiatives To Build On PA Research Leadership, Expand Reach Into World Markets9 February 2006
Governor Edward G. Rendell today unveiled initiatives that will build on Pennsylvania's cutting edge research - spurred by $1 billion in private and public investment - while helping state companies bridge borders and expand in global markets.
The Governor said the state is taking aggressive steps to build on its strengths and, at the same time, making sure that businesses have the assistance they need to export products around the world. Pennsylvania is the world's 17th largest economy and exports now total $18 billion annually.
"We are focused on growing our economy, improving our competitiveness and increasing our share of trade in foreign markets," Governor Rendell said.
The Governor added that his proposed 2006-07 budget contains a combination of business tax cuts, as well as $15 million in additional support to advance his job-creation and economic-growth strategies by helping businesses expand their markets globally.
The proposed budget also recognizes the vital role transportation infrastructure plays in economic development by including $130 million of new investment for roads and bridges and builds upon the Governor's Economic Stimulus package that is spearheading Pennsylvania's economic revival. Total highway spending in the Governor's proposed budget, including safety, maintenance and construction, is nearly $5.2 billion.
"I am committed to breathing new life into our communities and helping our businesses grow," Governor Rendell said. Our investments and aggressive initiatives have already helped Pennsylvania climb in national ranking for short-term job growth from 46th in 2003 to 15th in 2004.
"At the same time, there are more jobs now in Pennsylvania than at any time in our history. But there is more that we must do to ensure the economic future of our young people, businesses and communities.
"We are working proactively to make sure Pennsylvania and Pennsylvanians can compete in global markets. These targeted investments are critical to Pennsylvania's ability to support business growth and to help create new opportunities for our working men and women. In the face of more than $1 billion in federal cuts and fierce national and global competition, we must provide the tools and resources that will foster a business-friendly environment and make our communities attractive to new and expanding companies," the Governor added.
Business Tax Cuts: Improving PA's Ability to Compete for Jobs and Investments
The Governor said his proposed 2006-07 budget will include additional business tax cuts of more than $221 million, meaning that, if the Legislature approves his proposal, the Governor will have eliminated nearly $1 billion worth of business taxes since taking office three years ago.
The Governor will propose the following business tax cuts as part of the 2006-07 budget:
-- Net Operating Loss Carry-Forward - $7.3 million, by increasing the
per business cap from $2 million to $3 million
-- Research and Development Tax Credit - $40 million, an increase of $10
million over 2005-06 and $25 million over 2002-03
-- Capital Stock and Franchise Tax - Accelerate the phase-out by one-
tenth of a mill ($18.3 million) to lower the rate to 4.89 mills, a
total reduction of $204 million compared to 2005-06
World Trade PA: Expanding PA Exports and Encouraging Greater Foreign Investment in PA
Governor Rendell is steadfast in his commitment to invest in business growth, job creation, and increasing our state's global competitiveness. The 2006-07 budget includes $15 million in new funding to accelerate and expand the commonwealth's current trade and investment activities.
In order to continue to advance the commonwealth's competitiveness abroad, the Governor proposed the World Trade PA initiative designed to:
-- Increase Pennsylvania's share of trade in foreign markets;
-- Attract new foreign direct investment to secure jobs and capital; and
-- Leverage Pennsylvania's extensive network of overseas university
graduates to promote new business opportunities for the state.
"In today's increasingly competitive international economy, Pennsylvania companies compete against firms around the globe, and the state faces tough competition from other states and nations to attract job-producing, cross- border investment projects," the Governor said. "This initiative will help companies of all sizes to thrive in today's global market and become a driving and competitive force in international trade and investment."
World Trade PA will make key investments that are designed to help Pennsylvania companies expand their export potential. These investments include:
-- Developing a Virtual World Trade PA Operations Center with the goal
of doubling the number of companies that take advantage of export-
assistance services by 2007-08. The web-based Operations Center will
provide a one-stop-shop for businesses to assess their export
capacity to enter foreign markets, develop successful business plans,
and tap into an extensive sales/resource-referral network. This
virtual center will assist, guide and inform exporters about
Pennsylvania's programs and resources.
-- Expanding the commonwealth's network of overseas trade
representatives and increasing operations in China, India and other
emerging markets.
-- Launching an outreach and education campaign aimed at small and
medium-sized businesses to increase awareness of Pennsylvania's
innovative trade-promotion-assistance programs, including an
expansion of the commonwealth's Market Access Grant (MAG) and Export
Trade Finance programs.
-- Establishing an International Business Advisory Council to directly
advise DCED on methods to ensure that Pennsylvania businesses compete
successfully in global markets.
In the past, Pennsylvania focused it resources solely on trade and exports. Since taking office, Governor Rendell has also made attracting foreign direct investment a key priority. If Pennsylvania is to successfully capture its fair share of investment, the Governor emphasized that the state must act aggressively to ensure that international companies are adequately informed and familiar with Pennsylvania's strengths as a location for investment.
World Trade PA will invest new resources in international marketing and business attraction activities by intensifying attraction efforts in booming areas like Japan, India, the Republic of Korea and China, while maintaining the state's efforts in Europe and Canada.
"The state will use its competitive advantage in sectors like food processing, biotechnology, pharmaceuticals, next-generation electronics and financial services to attract new private sector investment, create jobs, and revitalize out communities," the Governor added.
A crucial part of the strategy will also involve the implementation of a regional "international marketing" grant program in order to help regional economic development partners develop a proactive international business attraction program in partnership with the commonwealth.
World Trade PA will also leverage Pennsylvania's extensive network of foreign-born university graduates to promote new business opportunities for the state. The initiative will create the Pennsylvania Global Business Alumni Program and will fund universities and Keystone Innovation Zones to hire coordinators who will be charged with connecting potential business leads with Pennsylvania firms.
The Jonas Salk Legacy Fund: Accelerating Medical Research in Pennsylvania
Last week, Governor Rendell announced an innovative, new $500 million initiative that strengthens the commonwealth's continuum of capital and infrastructure support to Pennsylvania's bioscience industry. The Jonas Salk Legacy Fund (JSLF): Accelerating Medical Research in Pennsylvania will help to attract a talented, diverse workforce that will tackle today's medical issues and create a more robust commercialization pipeline for companies. Grant funding through the Jonas Salk Legacy Fund will result in a projected 12,000 jobs in communities across the commonwealth.
"The Jonas Salk Legacy Fund will tackle tomorrow's medical issues today," the Governor said. "This investment will create jobs and fuel medical advancements that will solidify Pennsylvania's status as an international biosciences center.
"But this initiative is not just about economic development - it's about the health and future of every man, woman, and child in Pennsylvania. I am committed to making investments in medical research that will improve the lives of our residents and have a positive impact on their health, as well as the health of those around the world, by funding research that will cure disease."
To pay for the Legacy Fund, the Governor is proposing that the commonwealth use just under 10 percent of the state's share of tobacco settlement funds as backing for the issuance of bonds.
Each grant recipient is required to match the commonwealth's investment dollar-for-dollar. This investment will bring a total of $1 billion in new capital for investment in Pennsylvania's world-class bioscience community and the health and prosperity of its residents.
Nursing Initiative: Addressing Shortages in Critical Job Fields
Governor Rendell remains committed to addressing shortages in critical job fields. Projections from the federal Health Resources and Services Administration indicate that Pennsylvania is at risk of experiencing a severe Registered Nurse shortage by the year 2010. The lack of available educational opportunities for potential nurses is a critical public health issue. Pennsylvania's nursing schools simply do not have the capacity to educate as many nurses as the health care system requires.
The Governor has included $10 million in the proposed 2006-07 budget to tackle the state's nursing shortage. He proposes using the money to fund new faculty positions, so skilled and experienced professionals can train the next generation of nurse practitioners.
Highways and Bridges - Increasing Transportation's Role in Economic Development
Governor Rendell recognizes the critical role that transportation plays in economic development projects. For that reason, the 2006-07 budget includes $130 million for Pennsylvania's transportation system. This includes an investment to support 20 additional transportation projects linked to economic development through an $8 million, or 40 percent, increase to PennDOT's Pennsylvania Infrastructure Bank. This low-interest loan program offers municipalities flexible financing opportunities for transportation projects tied to economic development throughout the commonwealth.
Overall highway spending in the Governor's proposed budget, including safety, maintenance and construction, is nearly $5.2 billion.
"This funding will support vital economic development projects that will attract private sector money and create new opportunities for our working men and women," the Governor said. "Modern and safe roads, bridges and railway networks will not only attract businesses looking for cost-effective transportation, but will also improve the quality of life of Pennsylvania's residents."
The commonwealth's railway network provides a competitive advantage for businesses that depend upon cost-effective transportation of commodities. The Rail Freight Assistance program supports the rehabilitation of rail freight lines owned by private and public utilities. The Governor's budget recommends a $2 million increase to expand this program to preserve essential rail freight service and to stimulate economic development through the generation of new or expanded rail freight service.
Continuing Business and Job Development
This year's budget will build on Governor Rendell's Economic Stimulus package that will continue to focus investments in new high-growth companies and channel resources to our aging communities in need of new and improved infrastructure. The Economic Stimulus package is providing the resources that allow our traditional industries, especially manufacturing, to access new technology to enhance their productivity.
The Infrastructure Facilities Improvement Program (IFIP), a vital component of the Economic Stimulus package, is a multi-year grant program that provides grants to assist with the payment of debt service for certain types of infrastructure and building projects. Eligible projects include costs incurred by infrastructure improvements, remediation, administrative expenses and preparation of plans and studies. The 2006-07 budget includes an additional $10 million in multiyear grants through IFIP that will help Pennsylvania communities attract new business investments and jobs.
"By providing grants for infrastructure improvements, environmental remediation and building costs that support economic development projects, we will continue to bring new jobs and revenue to the commonwealth, laying the groundwork for our continued economic success for years to come," Governor Rendell said.
For more information on the Governor Rendell's proposed 2006-07, visit http://www.governor.state.pa.us/governor/cwp/view.asp?a=1101&q=445371 or http://www.newPA.com.
The Rendell Administration is committed to creating a first-rate public education system, protecting our most vulnerable citizens and continuing economic investment to support our communities and businesses. To find out more about Governor Rendell's initiatives and to sign up for his weekly newsletter, visit his Web site at: http://www.governor.state.pa.us.
CONTACT: Kate Philips
717-783-1116
Kevin Ortiz (DCED)
717-783-1132
Source: prnewswire
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